A new product has been launched which invests in fine wines in order to pay off a mortgage.
Home Cellars (ha!) from Premier Cru Fine Wine Investments invests in wine to eventually pay off an interest-only home loan. The 5 key points they put forward for investing in wine top cover a mortgage are:
- Potential to significantly reduce costs compared to Capital Repayment schemes;
- Investment is tax free and not assigned to the mortgage lender;
- Growth in Fine Wine generally exceeds standard investments;
- Long history of stability in the Fine Wine investment market;
- Investment is flexible allowing the holder to adjust monthly payments to suit financial needs; and
- Life assurance is a separate term insurance, meaning holders do not lose cover if the wine investment is temporarily stopped.
Alternative investments seem to be fairly popular at the moment, but I would recommend extreme caution if considering a product such as this. For a start, I don’t think wine investment is covered by the Financial Services Authority, so if it goes belly up, there is no protection? And there is unlikely to be much knowledge available about the products other than from the wine investment companies themselves.
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